TY  - JOUR
AU  - Goda,Gopi Shah
AU  - Golberstein,Ezra
AU  - Grabowski,David C.
TI  - Income and the Utilization of Long-Term Care Services:  Evidence from the Social Security Benefit Notch
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 16076
PY  - 2010
Y2  - June 2010
UR  - http://www.nber.org/papers/w16076
L1  - http://www.nber.org/papers/w16076.pdf
N1  - Author contact info:
Gopi Shah Goda
Stanford University
SIEPR
366 Galvez St.
Stanford, CA 94305
Tel: 650/736-0480
Fax: 650/723-8611
E-Mail: gopi@stanford.edu

Ezra Golberstein
Division of Health Policy and Management
University of Minnesota
School of Public Health
420 Delaware St. SE, MMC 729
Minneapolis, MN 55455
E-Mail: egolber@umn.edu

David Grabowski
Harvard University
Department of Health Care Policy
Harvard Medical School
180 Longwood Avenue
Boston, MA 02115
E-Mail: grabowski@med.harvard.edu
AB  - This paper estimates the impact of income on the long-term care utilization of elderly Americans using a natural experiment that led otherwise similar retirees to receive significantly different Social Security payments based on their year of birth.  Using data from the 1993 and 1995 waves of the AHEAD, we estimate instrumental variables models and find that a positive permanent income shock lowers nursing home use but increases the utilization of paid home care services.  We find some suggestive evidence that the effects are due to substitution of home care for nursing home utilization.  The magnitude of these estimates suggests that moderate reductions in post-retirement income would significantly alter long-term utilization patterns among elderly individuals.
ER  -